Trump Budget IncludesProposal to Privatize BPA Grid

by Pete Danko
Portland Business Journal, May 23, 2017

The Trump administration is proposing privatizing transmission assets owned by the Bonneville Power Administration, an idea that has popped up periodically since the Reagan administration but gone nowhere.

The proposal to sell off BPA's transmissions assets -- about three-quarters of the high-voltage grid in the Northwest -- is included among "major savings and reforms" offered up the administration in its fiscal year 2018 budget released on Tuesday.

The administration says unloading BPA's grid would save about $4.9 billion over the course of a decade.

The proposal also includes selling off other assets of the Power Marketing Administration for a total savings of $5.5 billion.

"Ownership of transmission assets is best carried out by the private sector where there are appropriate market and regulatory incentives," the administration says in its justification for the proposal. "The budget proposal to eliminate or reduce the PMA's role in electricity transmission and increase the private sector's role would encourage a more efficient allocation of economic resources and mitigate risk to taxpayers."

President Ronald Reagan proposed privatizing the BPA during his second term. President Bill Clinton made a similar bid in the mid-'90s. And in 2005, President George W. Bush proposed forcing BPA to sell its power at market rates, widely seen as a step toward privatization.

None of the proposals found sufficient support in Congress, and President Donald Trump's came in for immediate criticism.

Oregon's senior senator, Democrat Ron Wyden, sharply attacked the proposal, which he said would increase costs for "homes and businesses."

"I successfully fought Republicans' efforts more than a decade ago to privatize Bonneville Power, and I will fight this misguided attempt," Wyden said in a news release. "Public power customers in the Pacific Northwest have paid for the system and their investment should not be put up for sale."

The Public Power Council, which represents about 100 consumer-owned utilities in the region, put out a statement opposing the proposal and listing four major concerns: "(1) loss of regional control and value; (2) risk of increased costs to consumers; (3) potential for remote areas of the system to be neglected, harming rural communities; and, (4) impacts to reliability of what is currently a complex and integrated system."